European Commissioner responsible for Employment, Social Affairs and Inclusion

Tackling the youth unemployment challenge

Improving employability and labour market participation among young people

The 14th EU-Japan Symposium/Tokyo, 18 July 2012

It gives me great pleasure to be here for the opening of this important event on my first visit to Japan as Commissioner for Employment, Social Affairs and Inclusion.

I want to thank Deputy Minister Nishimura for her kind hospitality and the Japanese Government for hosting this 14th EU-Japan Symposium.

Our dialogue, which goes back over 20 years to 1991, shows how much we share and the magnitude of the challenges facing us.

The topic that brings us together today is certainly one of the most serious.

Economic growth has been weakening across Europe since last summer and a number of EU Member States have fallen into a double-dip recession.

These recent developments only come to reinforce the sense of urgency. Unemployment keeps rising and has almost hit 25 million people. That is 10.3% of the EU workforce. And the figures in some of the Member States are even more dramatic, in some cases over double the EU average unemployment rate.

But the recession is taking its heaviest toll on Europe's young people, and some say that this amounts to a youth employment crisis.

Indeed, for young Europeans, the situation is bleak.

At 22.4%, the unemployment rate for people under 25 is more than twice the rate for adults.

Today we have a staggering 5.5 million unemployed young people in the EU — and the long-term unemployment rate is rising.

And those young people who have managed to find jobs face other hardships.

They are over-represented among temporary workers — with 42% on temporary contracts, compared to a rate for all ages of 13.9%.

Many young people work part-time — sometimes by choice, more often for lack of an alternative.

29% are part-time workers, compared with 18.5% for all ages.

Even more worrying are the 7.5 million young people who are neither in employment, nor in education or training.

The percentage of 20-to-34 year-olds not in employment, education or training also varies considerably.

It ranges from 8.3% to as high as 27% in some Member States.

And it is going up.

There are also significant regional disparities across the EU.

Three of our 27 Member States have managed to keep the unemployment rate for young people under 10%.

But it is over 30% in eight Member States, and in Spain and Greece it is over 50%. That is an alarming situation.

The price that young people — and society as a whole — are paying for this youth unemployment or insecure employment is unacceptably high.

Just think of the economic and psychological impact it has on their personal lives, their career and family plans.

Think of the economic and social repercussions for their families and the community.

Think of the vulnerability to future shocks and the long-term social instability it breeds through a deterioration in skills and the prospective employers’ loss of confidence in young people, the scars it leaves on their careers and earnings.

What we risk is seeing a generation go to waste — an unmitigated economic and social disaster.

Unemployment, coupled with frustration at a lack of prospects, is an explosive mix.

It fuels unrest and political extremism — and carries a huge economic and social cost.

That is why we must stop young people from becoming discouraged.

We know they want to study and work and get ahead in life. They want to share in the prosperity — and enjoy the benefits — that today’s global, more environmentally friendly and fairer economy offers.

We know they are willing to contribute to the general well-being and shoulder their part of the burden of solidarity between generations as the baby-boom generation retires.

We must not let them down.

The EU takes these problems very seriously. In its role in coordinating national employment policy, the EU has taken practical steps to strengthen governance.

Our Europe 2020 Strategy — which seeks to turn the EU into the sort of Union that our fellow Europeans want to be living in by 2020 — puts young people at the centre and has a special agenda for improving education and employment for young people.

It is backed up by strict monitoring, surveillance and peer-review arrangements to ensure that key priorities are discussed at EU level before the Member States take their decisions.

The EU has already taken measures to give young people the opportunities they deserve.

In 2010, we launched Youth on the Move — an initiative that is part of the Europe 2020 Strategy to help more than 400 000 young people to work, train and study abroad every year.

And in April this year, the Commission adopted an Employment Package to show how employment policy can be a driver of growth.

A key component of the Employment Package is the Youth Opportunities Initiative.

It was announced last December when European Commission President Barroso called on business, the social partners and the national authorities to work together on the idea.

The Youth Opportunities Initiative will enable smoother transitions between education and work as well as to facilitate access to work for young unemployed. The aim is to help youngsters that are neither in education nor work to find a job, or return to training and to help those with a third level education find a first job. And this programme is backed by a considerable amount of EU funding.

Response to the Youth Opportunities Initiative from the EU Heads of State and Government was very positive.

It has instituted a new form of direct cooperation between the EU and the 15 Member States with very high youth unemployment.

At the end of May, the European Commission made proposals for recommendations to the Member States which address youth employment and education.

The Member States have now approved these country-specific recommendations at the highest political level, and will reflect them in future national reforms.

The recommendations are accompanied by actions financed directly by the Commission to help the Member States set up implementation mechanisms.

With its total budget of 76 billion euro, the European Social Fund is the EU’s main instrument for financing employment-related actions and human capital investment.

Later this year I intend to present a Youth Employment package of practical initiatives to tackle youth unemployment.

These will emphasise the promotion of effective school-to-work transitions via apprenticeships and traineeships.

It will give substance to two proposals. The first concerns common principles for quality traineeships.

The second involves Youth Guarantees to help young people get into the job market and ensure no one is left behind.

They will provide practical policy guidance to smooth the transition from school to work and promote fair treatment of young people.

Lastly, the Member States in the euro area recently agreed on a growth package.

It accounts for 1% of total euro-area GDP, to be channelled into growth and job-producing measures.

This will balance the effect of public budget fiscal consolidation under way in most Member States.

These initiatives and measures demonstrate the determination of the EU, the European Commission and the Member States to continue working together to improve the employment situation of young people.

Ladies and gentlemen,

Youth unemployment is not just an EU problem. It affects both the developed and the developing countries.

The leaders of the G20 group of countries share our sense of urgency to address the problem.

The first issue on the agenda of the G20 Task Force on Employment is precisely youth employment.

May I take the opportunity to thank Japan for its active support for the G20 Task Force.

Of special relevance to this symposium was the suggestion regarding the promotion of effective school-to-work transitions via quality apprenticeships and traineeships.

The Rio+20 UN conference agreed on the need for a global strategy for youth and employment that builds on the work of the International Labour Office.

Both the ILO and the OECD are making a valuable contribution to international consideration of this issue, and are leading the effort to achieve policy consistency among international organisations.

Japan and the EU are major actors in the UN, the ILO and the OECD.

If we want to shape global recommendations, we need to work even more closely together upstream, so we can send the same messages and work to attain the same objectives in those bodies.

By coordinating our positions, Japan and the EU can be more effective in such international institutions.

The challenges we face are similar, so I am confident that working together will help in determining the best strategy to bolster employment among young people.

This Symposium is a great opportunity to do exactly that. That is why I am glad to be here, and keen to hear what people have to say.

I am also very pleased that the social partners are present in number today.

Their contribution is essential to identifying the most pressing needs and the most effective remedies.

Their experience and expertise and their knowledge of best practice means no one else can offer policy-makers the same guidance.

Let’s be optimistic. By pooling our efforts, I believe we can achieve our goal and give our young people the opportunity to fulfil themselves.